Form of Warrant to Purchase Convertible Preferred Stock



 Exhibit 4.2 

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR
OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE WITH APPLICABLE LAW. 
 WARRANT TO PURCHASE STOCK 

 

			
	 Corporation:
	  	VETINSURANCE INTERNATIONAL, INC., a Delaware corporation
	 Number of Shares:
	  	
	 Class of Stock:
	  	Series          Preferred Stock
	 Initial Exercise Price:
	  	$
	 Issue Date:
	  	
	 Expiration Date:
	  	

 THIS WARRANT CERTIFIES THAT, for good and
valuable consideration, the receipt of which is hereby acknowledged, SQUARE 1 BANK or its assignee (“Holder”) is entitled to purchase the number of fully paid and nonassessable shares of the class of securities (the
“Shares”) of VETINSURANCE INTERNATIONAL, INC. (the “Company”) at the initial exercise price per Share (the “Warrant Price”) all as set forth above and as adjusted pursuant to
Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this warrant (the “Warrant”). 

ARTICLE 1 
 EXERCISE

 1.1. Method of Exercise. Holder may exercise this Warrant by delivering this Warrant and a duly executed Notice of Exercise in
substantially the form attached as Appendix 1 to the principal office of the Company. Unless Holder is exercising the conversion right set forth in Section 1.2, Holder shall also deliver to the Company a check for the aggregate Warrant Price
for the Shares being purchased. 
  
 1.2. Conversion Right. In
lieu of exercising this Warrant as specified in Section 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other
securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be determined pursuant to Section 1.4. 

 
 1.3. Intentionally Omitted. 

 
 1.4. Fair Market Value. If the Shares are traded regularly in a
public market, the fair market value of the Shares shall be the closing price of the Shares (or the closing price of the Company’s stock into which the Shares are convertible) reported for the business day immediately before Holder delivers its
Notice of Exercise to the Company. If the Shares are not regularly traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment. 

 
 1.5. Delivery of Certificate and New Warrant. Promptly after
Holder exercises or converts this Warrant, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so
acquired. 
 1.6. Replacement of Warrants. On receipt of evidence reasonably satisfactory to the Company of the loss, theft,
destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation, on surrender and cancellation of
this Warrant, the Company at its expense shall execute and deliver, in lieu of this Warrant, a new Warrant of like tenor. 







 1.7. Repurchase on Sale, Merger, or Consolidation of the Company. 

1.7.1 “Acquisition.” For the purpose of this Warrant, “Acquisition” means (a) any sale,
license, or other disposition of all or substantially all of the assets (including intellectual property) of the Company, (b) any sale or disposition of all or substantially all of the capital stock of the Company, or (c) any
reorganization, consolidation, merger or sale of the voting securities of the Company or any other transaction where the holders of the Company’s securities before the transaction beneficially own less than 50% of the outstanding voting
securities of the surviving entity after the transaction. 
 1.7.2 Assumption of Warrant. If upon the closing of any Acquisition the
successor entity assumes the obligations of this Warrant, then this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if
such Shares were outstanding on the record date for the Acquisition and subsequent closing. The Warrant Price shall be adjusted accordingly. The Company shall use reasonable efforts to cause the surviving corporation to assume the obligations of
this Warrant. 
 1.7.3 Non assumption. If upon the closing of any Acquisition the successor entity does not assume the obligations of
this Warrant and Holder has not otherwise exercised this Warrant in full, then [this Warrant shall be deemed to have been automatically converted pursuant to Section 1.2 and thereafter Holder shall participate in the Acquisition on the
same terms as other holders of the same class of securities of the Company.] [Holder shall have the option either to (a) deem this Warrant to have been automatically converted pursuant to Section 1.2 and thereafter Holder shall
participate in the Acquisition of the same terms as other holders of the same class of securities of the Company; or (b) require the Company to purchase this Warrant for cash upon the closing of the Acquisition for an amount per Share equal to
one (1) times the Warrant Price.] 
 ARTICLE 2 

ADJUSTMENTS TO THE SHARES 

2.1. Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on its common stock payable in common stock, or other
securities, or subdivides the outstanding common stock into a greater amount of common stock, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which
Holder would have been entitled had Holder owned the Shares of record as of the date the dividend or subdivision occurred. 
 2.2.
Reclassification, Exchange or Substitution. Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder
shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification,
exchange, substitution, or other event. Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the
Company’s Certificate of Incorporation. The Company or its successor shall promptly issue to Holder a new warrant for such new securities or other property. The new Warrant shall provide for adjustments which shall be as nearly equivalent as
may be practicable to the adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this
Section 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events. 
 2.3. Adjustments
for Combinations, Etc. If the outstanding Shares are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased. If the outstanding Shares are combined or
consolidated, by reclassification or otherwise, into a greater number of shares, the Warrant Price shall be proportionately decreased. 

2.4. Adjustments for Diluting Issuances. In the event of the issuance (a “Diluting Issuance”) by the Company after the Issue
Date of securities at a price per share Jess than the Warrant Price, then the number of shares of common stock issuable upon conversion of the Shares shall be adjusted in accordance with those provisions of the Company’s Certificate of
Incorporation that apply to Diluting Issuances. 

  
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 2.5. Certificate as to Adjustments. Upon each adjustment of the Warrant Price, the Company
at its expense shall promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request,
furnish Holder a certificate setting forth the Warrant Price in effect upon the date thereof and the series of adjustments leading to such Warrant Price. 

2.6. Fractional Shares. No fractional Shares shall be issuable upon exercise or conversion of this Warrant and the Number of Shares to
be issued shall be rounded down to the nearest whole Share. If a fractional share interest arises upon any exercise or conversion of this Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount computed by
multiplying the fractional interest by the fair market value of a full Share. 
 ARTICLE 3 

REPRESENTATIONS, WARRANTIES AND COVENANTS 

3.1. Representations and Warranties of the Company. The Company hereby represents and warrants to the Holder as follows: 

(a) The initial Warrant Price referenced on the first page of this Warrant is the per share price paid in Company’s most recent
equity financing. 
 (b) All Shares which may be issued upon the exercise of the purchase right represented by this Warrant, and all
securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances (other than those created by Holder) except for restrictions
on transfer provided for herein or under applicable federal and state securities Laws. 
 (c) The Company’s capitalization table
attached to this Warrant is true and complete as of the Issue Date. 
 3.2. Notice of Certain Events. The Company shall provide
Holder with not less than 10 days prior written notice, including a description of the material facts surrounding, any of the following events: (a) declaration of any dividend or distribution upon its common stock, whether in cash, property,
stock, or other securities and whether or not a regular cash dividend; (b) offering for subscription pro rata to the holders of any class or series of its stock any additional shares of stock of any class or series or other rights;
(c) effecting any reclassification or recapitalization of common stock; or (d) the merger or consolidation with or into any other corporation, or sale, lease, license, or conveyance of all or substantially all of its assets, or
liquidation, dissolution or winding up. 
 3.3. Information Rights. So long as the Holder holds this Warrant, the Company shall
deliver to the Holder (a) within one hundred fifty (150) days after the end of each fiscal year of the Company (beginning with the 2007 fiscal year), the annual audited financial statements of the Company certified by independent public
accountants of recognized standing and (b) within forty-five (45) days after the end of each of the first three quarters of each fiscal year, the Company’s quarterly, unaudited financial statements. 

3.4. Registration Under Securities Act of 1933, as amended. The Company and Holder shall enter into that certain Amendment No. 1
to Registration Rights Agreement dated as of even date with the Warrant so that the Shares or, if the Shares are convertible into common stock of the Company, such common stock, shall be “Registrable Securities’’, and Holder shall be
a “Holder” under that certain Registration Rights Agreement between the Company and certain investors dated as of April 20, 2007 (the “Rights Agreement”). 

3.5. Holder Investment Representations. Holder makes the representations to the Company set forth in Exhibit A hereof in connection
with the issuance of this Warrant and the Shares (collectively, the “Securities”). 

  
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 3.6. Lock-Up Agreement. Holder shall be subject to Section 1.14 of the Rights
Agreement (captioned “Lock-Up Agreement”), as the same may be amended from time to time; provided that, without the prior written consent of Holder, no amendment to such Section 1.14 will be effective as to Holder if such amendment
would treat Holder differently than other holders of the Shares, generally. 
 ARTICLE 4 

MISCELLANEOUS 
 4.1.
Term: Exercise Upon Expiration. This Warrant is exercisable in whole or in part, at any time and from time to time on or before the Expiration Date set forth above. If this warrant has not been exercised prior to the Expiration Date, this
Warrant shall be deemed to have been automatically exercised on the Expiration Date by “cashless” conversion pursuant to Section 1.2. 

4.2. Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any)
shall be imprinted with a legend in substantially the following form as well as any additional legends that the Company and Holder mutually agree upon with respect to such Shares: 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT IN ACCORDANCE
WITH APPLICABLE LAW. 
 4.3. Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this
Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned in whole or in part without; (a) compliance with applicable federal and state securities laws by the
transferor and the transferee; (b) the transferee making the representations of Holder set forth in this Warrant; and (c) the transferee’s agreement to be bound by all of the obligations of Holder set forth in this Warrant. The
Company shall not require Holder to provide an opinion of counsel if the transfer is to an affiliate of Holder or if there is no material question as to the availability of current information as referenced in Rule 144(c), Holder represents that it
has complied with Rule 144(d) and (e) in reasonable detail, the selling broker represents that it has compiled with Rule 144(f), and the Company is provided with a copy of Holder’s notice of proposed sale. 

4.4. Transfer Procedure. Subject to the provisions of Section 4.3, Holder may transfer all or part of this Warrant or the Shares
issuable upon exercise of this Warrant (or the securities issuable, directly or indirectly, upon conversion of the Shares, if any) by giving the Company notice of the portion of the Warrant being transferred setting forth the name, address and
taxpayer identification number of the transferee and surrendering this Warrant to the Company for reissuance to the transferee(s) (and Holder, if applicable). No surrender or reissuance shall be required if the transfer is to an affiliate of Holder.

 4.5. Notices. All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and
effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or the Holder, as the case may be, in writing
by the Company or such Holder from time to time. 
 All notices to the Holder shall be addressed as follows: 

Square 1 Bank 
 Attention:
Warrant Administrator 
 406 Blackwell Street, Suite 240 

Crowe Building 
 Durham, NC 27701


  
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 All notices to the Company shall be addressed as follows: 

VetInsurance International, Inc. 

Attention: Chief Financial Officer 

505 Fifth Ave S, Suite 600 

Seattle, WA 98104 
 With a copy,
which shall not serve as notice, to: 
 Christine Osvald-Mruz 

Lowenstein Sandler PC 
 65
Livingston Avenue 
 Roseland, New Jersey 07068 

4.6. Amendments. This Warrant and any term hereof may be changed, waived, discharged or terminated only by an instrument in writing
signed by the party against which enforcement of such change, waiver, discharge or termination is sought. 
 4.7. No Voting or Dividend
Rights. Nothing contained in this Warrant shall be construed as conferring upon Holder hereof the right to vote or to consent as a stockholder in respect of meetings of stockholders for the election of directors of the Company or any other
matters or any rights whatsoever as a stockholder of Company. No dividends or interest shall be payable or accrued in respect of this Warrant or the interest represented hereby or the shares purchasable hereunder until, and only to the extent that,
this Warrant shall have been exercised. 
 4.8. Attorneys’ Fees. In the event of any dispute between the parties concerning the
terms and provisions of this Warrant, the party prevailing in such dispute shall be entitled to collect from the other party all costs incurred in such dispute, including reasonable attorneys’ fees. 

 

  
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 4.9. Governing Law. This Warrant shall be governed by and construed in accordance with the
laws of the State of Delaware, without giving effect to its principles regarding conflicts of law. 

			
	
	VETINSURANCE INTERNATIONAL, INC.
		
	By:	 	  

		
	Name:	 	  

		
	Title:	 	  

	
	SQUARE 1 BANK
		
	By:	 	  

		
	Name:	 	  

		
	Title:	 	  




  
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 APPENDIX 1 

NOTICE OF EXERCISE 
 1. The
undersigned hereby elects to purchase _______________ shares of the _____________ stock of VETINSURANCE INTERNATIONAL, INC., (the “Company”) pursuant to the terms of the attached Warrant, and tenders herewith payment of the purchase price
of such shares in full. 
 1. The undersigned hereby elects to convert the attached Warrant into shares in the manner specified in the
Warrant. This conversion is exercised with respect to ___________ of the shares covered by the Warrant. 
 [Strike paragraph that does
not apply.] 
 2. Please issue a certificate or certificates representing said shares in the name of the undersigned or in such other
name as is specified below: 
 Square 1 Bank 

Attention: Warrant Administrator 

406 Blackwell Street, Suite 240 

Crowe Building 
 Durham, NC 27701

 3. The undersigned makes the representations to the Company set forth in Exhibit A hereof in connection with the issuance of the
Securities. 
  

			
	
	SQUARE 1 BANK or Registered Assignee
	
	  

	(Signature)
	
	  

	(Date)








 EXHIBIT A 

INVESTMENT REPRESENTATIONS 
 (a) The
undersigned is aware of the Company’s business affairs and financial condition, and has acquired sufficient information about the Company to reach an informed and knowledgeable decision to acquire the Securities. The undersigned is purchasing
the Securities for its own account for investment purposes only, not as a nominee or agent, and not with a view towards, or for resale in connection with, any “distribution” thereof for purposes of the Securities Act of 1933, as amended
(the “Securities Act”). The undersigned has such knowledge and experience in financial business matters and the undersigned is capable of evaluating the merits and risks of the purchase of the Securities and of protecting its interests in
connection therewith. 
 (b) The undersigned understands that the Securities have not been registered under the Securities Act in reliance upon a specific
exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the undersigned’s investment intent as expressed herein. 

(c) The undersigned further understands that the Securities must be held indefinitely, and the undersigned must therefore bear the economic risk therewith,
unless the Securities are subsequently registered under the Securities Act or unless an exemption from registration is otherwise available. In addition, the undersigned understands that the certificate evidencing the Securities will be imprinted
with a legend which prohibits the transfer of the Securities unless they are registered or such registration is not required. 
 (d) The undersigned is
familiar with the provisions of Rule 144, promulgated pursuant to the Securities Act, which, in substance, permits limited public resale of “restricted securities” acquired, directly or indirectly, from the issuer thereof, in a non-public
offering subject to the satisfaction of certain conditions. 
 (e) The Securities may be resold in certain limited circumstances subject to the provisions
of Rule 144, which requires, among other things, the existence of a public market for the Securities, the availability of certain current public information about the Company, the resale occurring not less than one year after a party has purchased
and paid for the security to be sold, the sales being effected through a “broker’s transaction” or in transactions directly with a “market maker” and the number of securities being sold during any three-month period not
exceeding specified limitations. 
 (f) The undersigned further understands that in the event that all of the applicable requirements of Rule 144 are not
satisfied, registration under the Securities Act, compliance with Regulation A, or some other registration exemption will be required. 
 (g) The
undersigned is an “accredited investor” as defined in Rule 501(a) of Regulation D promulgated under the Securities Act.